Utility-scale solar has become one of the cheapest new power sources, with costs down roughly 90% since 2010, while 2024 deployment volume outpaced every other generation technology. Paired with record-low battery prices, solar-plus-storage is already powering an AI data center in Arizona — though it still falls short of full 24-hour dispatchable baseload.
How Did Solar Go From the Most Expensive to the Cheapest Power Source?
Utility-scale solar is now among the cheapest ways to add new electricity capacity, according to Lazard's cost analysis.
Lazard's 18th edition Levelized Cost of Energy report, published in June 2025, puts unsubsidized U.S. utility-scale solar LCOE at $38–78 per MWhCITE:E1. The low end of that range, $38/MWh, undercuts the low end of combined-cycle natural gas, priced at $48/MWhCITE:E1.
This is not a recent anomaly but the result of a decade-long decline. IRENA's global data show the weighted-average utility-scale solar LCOE fell to $0.043/kWh — about $43/MWh — in 2024, down roughly 90% from $0.417/kWh in 2010CITE:E2. IRENA also found 2024 solar costs ran about 41% below fossil-fuel generationCITE:E2.
| Source | Technology | Cost (US$/MWh) |
|---|
| Lazard (2025) | Utility-scale solar, unsubsidized | 38–78 |
| Lazard (2025) | Natural gas combined cycle, low end | 48 |
| IRENA (2024) | Global utility-scale solar, weighted avg. | ~43 |
| Lazard (2025) | Battery storage, 4-hour (LCOS) | 145–319 |
| Lazard (2025) | Natural gas peaker | 149–251 |
| Lazard (2025) | Nuclear | 141–220 |
Why Can Solar Be Deployed Faster Than Any Other Power Source?
Solar capacity additions outpaced every other electricity source worldwide in 2024, according to the IEA.
The IEA reports global solar capacity additions reached approximately 553 GW in 2024, up about 30% from 2023CITE:E3. Solar and wind combined accounted for 95% of all new renewable capacity added worldwide that year, with solar alone installed at roughly five times the volume of windCITE:E3. That volume marks solar as the power source that scaled the most within a single year, ahead of every other generation technology tracked in the IEA dataCITE:E3.
How Does Falling Battery Storage Cost Turn Solar Into Quasi-Baseload Power?
Battery prices hit a record low in 2024, according to BloombergNEF, making it cheaper to shift solar-generated power into nighttime hours.
BloombergNEF's global survey found the volume-weighted average lithium-ion battery pack price fell to $115/kWh in 2024, a decline of about 20% year-over-year and the largest drop since 2017CITE:E4. In China, average battery pack prices fell as low as $94/kWhCITE:E4.
Is There a Proven Case of Solar-Plus-Storage Powering an AI Data Center?
Ørsted's Eleven Mile Solar Center in Arizona is already supplying solar-plus-storage power to a Meta data center.
The project combines 300 MW of solar generation with 300 MW / 1,200 MWh of battery storage — a four-hour duration system — and began commercial operation in October 2024CITE:E5. Under a power purchase agreement, Eleven Mile Solar Center supplies electricity to Meta's Mesa, Arizona data centerCITE:E5. This is a completed, grid-connected asset already in operation, not a proposed or planned projectCITE:E5.
What Are the Limits — Why Isn't Solar-Plus-Storage a Complete Solution?
Solar-plus-storage cannot yet fully replace dispatchable baseload power, according to Lazard's cost data.
Battery storage carries its own levelized cost: Lazard's 2025 analysis puts four-hour battery storage at $145–319 per MWhCITE:E6. To provide firm, round-the-clock baseload power, grids still require dispatchable sources such as natural gas peaker plants, priced at $149–251/MWh, or nuclear power, priced at $141–220/MWhCITE:E6. Solar-plus-storage is therefore the fastest and cheapest way to cover most, but not all, of an AI data center's power needsCITE:E6.
What this means
Together, these figures form a specific pattern rather than a general trend. Solar's per-unit cost has fallen about 90% since 2010CITE:E2 and now undercuts natural gas at the low endCITE:E1, while 553 GW of 2024 additionsCITE:E3 show that scale is achievable within a single year. Cheaper battery packs at $115/kWhCITE:E4 are what made a project like Eleven Mile Solar Center's 1,200 MWh systemCITE:E5 economically viable. But the same Lazard dataset that shows solar undercutting gas also shows four-hour storage priced at $145–319/MWh, still above gas peaker and nuclear costsCITE:E6 — meaning the Arizona project's four-hour battery shifts part of the day's solar output into the evening, not the full 24-hour cycle.